European shares fell in early trading on Tuesday with all major sectors in the red though banks led the decline on fresh political jitters and following a downgrade by a top global broker. And concerns about situations involving Greece, Italy and the European Central Bank kept the euro under pressure. Ciara Lee reports.
All major sectors in the red - a bumpy start to the week for European shares. Banks were the biggest fallers, down more than 1 percent, after Deutsche Bank cut its rating on the sector by one notch to "underweight". Italian banking shares were down on worries over early elections. The biggest bank, Unicredit, fell more than 2 percent. (SOUNDBITE) (English) SEVEN INVESTMENT MANAGEMENT, MARKETING DIRECTOR, JUSTIN URQUHART STEWART, SAYING: "We obviously have the problems with the Italian banks which go right the way through the system. But it's also the German banks, whether it's the Landesbank or indeed Deutsche Bank. They've got issues that need to be sorted out. They weren't properly addressed." Fresh concerns about Greece put pressure on the euro. A German press report saying the in-debted nation may opt out of its next bailout payment if creditors can't strike a debt relief deal. The report denied by Athens. Euro zone finance ministers failed to agree with the IMF on Greek debt relief or to release new loans to Athens last week. (SOUNDBITE) (English) SEVEN INVESTMENT MANAGEMENT, MARKETING DIRECTOR, JUSTIN URQUHART STEWART, SAYING: "It can be resolved, it's just at the moment the authorities don't wish to actually grab that particular very unpleasant nettle. There needs to be some more imagination here. For example what you could do is actually split the currency you could have a domestic currency maybe the tradable Olive and then actually then you allow the external currency the euro to carry on" In the UK, shares of British Airways-owner IAG fell 4 percent following the massive disruption to flights after an IT outage. And sterling retreated after Prime Minister Theresa May's lead over the opposition party dropped to 6 percentage points in the latest poll to show a tightening race.